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Fabricato 3Q 2021 Profits Soar Year-on-Year

Sunday, 07 November 2021 10:11 Written by

Medellin-based textile giant Fabricato reported November 6 that its third quarter (3Q) 2021 net profit came in at COP$11.1 billion (US$2.86 million), a big reversal from the COP$3.3 billion (US$852,000) net loss in 3Q 2020.

As for the first nine months of 2021, net income reached COP$12.1 billion (US$3.1 million), up from a COP$22 billion (US$5.7 million) net loss for the first nine-months of 2020.

Earnings before interest, taxes, depreciation and amortization (EBITDA) for nine-months 2021 jumped 386% year-on-year, to COP$41.5 billion (US$10.7 million), with EBITDA margin at 13.3%, up sharply from 3.2% in nine-months 2020.

“The textile operation accounted for 96% of total EBITDA,” according to Fabricato.

Revenues through nine-months 2021 are up 55% year-on-year, to COP$311 billion (US$80 million), the company added.

“So far this year, we have achieved positive operating profit and EBITDA every month,” Fabricato reveraled in its filing with Colombia’s Superfinanciera oversight agency.

Through September 2021, “we present the highest gross profit of the last seven years, at a value of COP$58 billion [US$15 million],” the company added.

Meanwhile, technological innovation is moving hand-in-hand with improved profitability, according to Fabricato.

“Recently, machines were acquired to recover cotton from used garments, and investments will be made aimed at optimizing/reusing the water and some chemicals used in the textile process, thus contributing to mitigating the environmental impact of disposal of textiles in landfills and contributing to the circular economy.

“They will be in operation in early 2022 with great environmental benefits and cost optimization,” according to the company.

Also boosting results: “We increased self-generation of energy with respect to 2019 in the same period of time by 30% with a positive impact on cost,” according to Fabricato.

“The focus on making the company profitable both in the textile operation and in the real estate activity continues, complemented by rigorous monitoring of spending efficiency.

“Despite the international crisis in the supply of raw materials, we have lowered the average lead times of the different production lines by between 15% and 20%, compared to 2019.

“The quality index of all production lines has been improved between 2 and 3 basis points, compared to 2019.

“Labor productivity measured in meters produced per capita rose 20% compared to 2019.

“The various structural factors that are manifested by global shortages and logistics restrictions worldwide will continue to arise and for this we have prepared ourselves with improvements and efficiencies in all areas of the company,” the company added.


Medellin-based electric power giant Celsia – a division of Grupo Argos – on November 4 reported third quarter (3Q) 2021 net income of COP$105 billion (US$27 million), up 51.8% year-on-year.

Revenues in 3Q 2021 climbed 19.4%, to COP$978 billion (US$252 million), while consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) rose 23%, to COP$316 billion (US$81 million).

For the first nine months of 2021, revenues are up 9.8%, to COP$2.89 trillion (US$745 million), consolidated EBITDA is up 7%, to COP$966 billion (US$249 million) and consolidated net income is up 22%, to COP$309 billion (US$79.5 million), according to the company.

Meanwhile, capital spending so far in 2021 has hit nearlyCOP$1 trillion (US$257 million), according to the company.

On the “green energy” front, Celsia recently won a 225 gigawatt-hour renewable energy auction that will be supplied by the “Celsia Solar Escobal 6” solar photovoltaic farm to be built in Ibagué.

“Celsia Solar Escobal is part of our goal of having more than 25% of our installed power in non-conventional renewable energies,” added Celsia CEO Ricardo Sierra. “For next year we will multiply our capacity for unconventional renewable energy in Colombia by 18 times, compared to 2017.”

On a related “green” front, Celsia announced it has now cut the intensity of its CO2 emissions by 76% compared to 2015, while its similarly environment-friendly “ReverdeC” program -- aiming to protect vulnerable water basins -- has resulted in planting of 1.5 million trees over 4,452 hectares.


Medellin-based multinational supermarket and dry-goods retailer Grupo Éxito announced November 3 that its third quarter (3Q) 2021 net income rose 144% year-on-year, to COP$126 billion (US$32.8 million).

Recurring earnings before interest, taxes, depreciation and amortization (EBITDA) rose 42%, to COP$353 billion (US$92 million), while sales rose 13.5%, to COP$3.98 trillion (US$1.04 billion), according to the company.

In Colombia, sales rose 14.3% year-on-year, to COP$3 trillion (US$782 million), “the best quarterly increase in recent years,” according to Éxito. Recurring EBITDA margin in Colombia was 8.7% over operating income -- 200 basis points more -- compared to the same period of 2020 and 8.5% so far this year.

“The higher levels compared to those reported in 2020 and 2019 reflect the operational efficiencies achieved in the midst of a recovery in consumption due to the economic reactivation” happening in Colombia, according to Éxito.

The jump in EBITDA is the result of Exito’s “strategy focused on innovation and omnichannel and optimal control of expenses in the three countries” where in operates: Colombia, Uruguay and Argentina.

In Colombia, electronic and direct commerce channel sales accounted for 12.2% of total sales, indicating that “virtual commerce is here to stay,” according to Éxito. Such sales in Colombia hit COP$344 billion (US$89 million) during 3Q 2021, the company added.

Meanwhile, “the innovative formats ‘Éxito Wow’ and ‘Carulla FreshMarket’ continue to be important levers of differentiation and competitiveness; the first represented 27.8% of Éxito's total sales and the second, 36.2% of Carulla,” according to the company.

“The diversification strategy of complementary businesses -- mainly financial and real estate -- continued to contribute to the result. The occupancy rate of shopping centers reached 92% in Colombia and 89% in Argentina in September.

“The gradual recovery of the economy in Uruguay was reflected in a higher recurring EBITDA margin of the operation in this country (10.1%), benefited by higher productivity and commercial margin and a strict control of expenses.

“In Argentina, Grupo Libertad’s sales in local currency grew 58.1%, above the high level of inflation, benefiting from the economic reactivation, better performance of the food business and the electronic and direct commerce channels that reached a participation in total sales of 2.7%,” the company added.

In Colombia, recurring EBITDA margin was 8.7% over operating income -- 200 basis points more -- compared to the same period of 2020 and 8.5% so far this year.

“The higher levels compared to those reported in 2020 and 2019 reflect the operational efficiencies achieved in the midst of a recovery in consumption due to the economic reactivation of the country,” according to Éxito.

“The economic reactivation in the three countries where Grupo Éxito operates favored an atmosphere of optimism and confidence,” resulting in a 15% jump in sales corporate-wide, the company added.


ISA 3Q 2021 Net Income Drops Sharply Year-on-Year

Thursday, 04 November 2021 08:38 Written by

Medellin-based multinational electric-power transmission builder-operator, highways concessionaire and telecom services provider ISA – now 51% owned by Colombia’s mostly state-owned Ecopetrol oil company – on November 3 reported third quarter (3Q) 2021 net income of COP$121 billion (US$31.5 million), down 78% from 3Q 2020.

Despite the profit decline, ISA’s earnings before interest, taxes, depreciation and amortization (EBITDA) actually rose 5.8% year-on-year, to COP$1.86 trillion (US$486 million), while operating revenues likewise rose 7%, to COP$2.86 trillion (US$747 million), according to the company.

The rise in operating revenues “was mainly due to the entry-into-operation of energy transmission projects, the consolidation of Orazul Energy Group at the end of the third quarter of 2020, the Ruta Costera [Colombia highway concession] project as of the fourth quarter of 2020 and PBTE [Brazil power transmission] as of March 2021, in addition to the increase in construction activity of concessions in Brazil and Chile,” according to ISA.

“When deducting the impact of the costs associated with the reprofiling of ISA InterChile’s debt and the change in the income tax rate in Colombia, accumulated income would total COP$1.6 trillion [US$418 million], 4.8% higher with respect to the same period of the previous year,” according to the company.

“ISA’s natural hedging strategy, where each company seeks to incur debt in the same currency in which revenues are received, resulted in the effect of exchange rate variations on net income for the whole year to be -1.1%,” the company added..

Among 3Q 2021 highlights:

1. More electricity transmission projects entering into commercial operation, including the Nueva Pan de Azúcar-Polpaico Reactive Compensation in ISA InterChile; the IE Itaipura in ISA CTEEP in Brazil; the Triple A Connection in Transelca (Colombia) and “72 reinforcements to the existing network in ISA CTEEP in Brazil, which together contributed total annual revenues of US$30 million,” according to the company.

2. ISA InterChile issued its first structured green bond on July 26, totaling US$1.2 billion, at a 35-year term and a 4,5% coupon. “This allowed the re-profiling of the existing debt of the Cardones-Polpaico project, lowering the financial cost and increasing the average life of the loan, thereby achieving a better match with the life of the asset. This is a key project in Chile, under the government's program of decarbonization and mitigation of climate change impacts,” according to ISA.

3. Construction of 25 energy transmission projects and 257 reinforcements in Brazil. “These will contribute total annual revenues of US$382 million once they are in operation,” according to ISA.

4. Winning a crucial environmental license for the UPME07-2017 Sabanalarga-Bolívar 500-kV transmission project in Colombia, thereby clearing the way for construction to begin.


Medellin-based utilities giant EPM announced November 2 that its third quarter (3Q) 2021 net income hit COP$2.8 trillion (US$730 million), up sharply from COP$1.3 trillion (US$337 million) in 3Q 2020.

Earnings before interest, taxes, depreciation and amortization (EBITDA) jumped 28% year-on-year, to COP$5.5 trillion (US$1.4 billion), while EBITDA margin came-in at a healthy 30%, according to the company.

Meanwhile, 3Q 2021 revenues amounted to COP$18.2 trillion (US$4.7 billion) as the Colombian economy continues to recover from last year's Covid-19 depression.

As a result, “EPM maintains healthy and solid finances,” according to the company, 100% owned by the city of Medellin.

“The group's investments in infrastructure as of September were COP$2.7 trillion [US$704 million] of which COP$1 trillion [US$261 million] corresponds to the Hidroituango hydroelectric project.

“Through September, EPM has paid the municipality of Medellín COP$1.3 trillion [US$339 million] of the total COP$1.4 trillion [US$365 million] scheduled to be transferred during 2021."

Macroeconomic reactivation, relatively heavy rains in Colombia supporting its hydroelectric power output, lower operating costs and the lower impact of Covid-19 all boosted financial results, according to the company.

Net foreign-currency-exchange expense in 3Q 2021 was just COP$24 billion (US$6.3 million), 97% lower than the same period in 2020, “caused by the restatement of the debt in dollars associated with the accumulated devaluation of the Colombian peso of 11.72 % and a closing rate of COP$3,834.68 per US$1,” according to EPM.

On the other hand, accounts-receivable balances rose to COP$158 billion (US$41 million) and non-payment of utility bills rose to COP$159 billion (US$41.4 million), both resulting from the Covid-19 pandemic.

Despite those losses, Grupo EPM total assets rose 4% year-on-year, to COP$66.5 trillion (US$17.3 billion); liabilities rose 5%, to COP$38.5 trillion (US$10 billion), and shareholder equity rose 4%, to COP$28 trillion (US$7.3 billion), according to the company.

Financial debt for both EPM Group and its parent holding company was 41%. The Debt/EBITDA indicator for EPM Group closed at 3.74, better than the 4.41 ratio for 3Q 2020.

“Discounting the available cash reserve, the net debt/EBITDA indicator stood at 3.10 for the EPM Group and at 4.39 for the parent EPM,” the company added.


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Medellin Herald is a locally produced, English-language news and advisory service uniquely focused upon a more-mature audience of visitors, investors, conference and trade-show attendees, property buyers, expats, retirees, volunteers and nature lovers.

U.S. native Roberto Peckham, who founded Medellin Herald in 2015, has been residing in metro Medellin since 2005 and has traveled regularly and extensively throughout Colombia since 1981.

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